THE KUMBADAJE SERVICE CO OPERATIVE BANK LIMITED 383 MOVVAR,MOVVAR vs. ITO WARD 1 AND TPS, KASARAGOD, KASARAGOD
In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.
What did the Tribunal hold?
The Tribunal held that interest income derived from nominal/associate members also qualifies for Section 80P deduction, following a later Supreme Court decision. Therefore, the denial of deduction by the lower authorities was incorrect.
What were the facts?
The assessee, a cooperative bank, claimed deduction under Section 80P on interest income. The Assessing Officer disallowed the deduction for interest earned from nominal/associate members, citing a Supreme Court ruling. This disallowance was upheld by the CIT(A).
What were the issues?
Whether interest income derived from nominal/associate members of a cooperative society is eligible for deduction under Section 80P of the Income Tax Act.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Cases cited in this judgment(2)Show listHide list
Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.
- Mavilayi Service Co-operative Bank Ltd. v. CIT999 citing431 ITR 1 · 2021 · SC
- Citizen Co-operative Society Ltd. v. ACIT499 citing397 ITR 1 · 2017 · SC
Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN
Before: Shri Satbeer Singh Godara & Shri Amarjit Singh
Heard together (8 matters)
Read from the judgment's own cause title. This page is filed under one of them.
O R D E R Per Bench : These assessee’s four appeals ITA.Nos.385, 388, 392 and 574/Coch./2024 and as many as stay applications S.A.Nos.137, 139, 138 & 140/Coch./2024, for the assessment years 2015-2016, 2016-17, 2017-18 and 2014-215; case- wise, respectively and the relevant particulars are tabulated as under :
388, 392 & 574/Coch./2024 along with SA.Nos.137 to 140 /Coch/2024 & Ors. The Kumbadaje SCB Limited. Sl. DIN & Order No. Date No. 1 385/Coch/2024 2015-2016 ITBA/APL/S/250/2023-24/ 23.03.2024 1063251510(1) 2 388/Coch/2024 2016-2017 ITBA/APL/S/250/.2023-24/ 23.03.2024 1063259884(1) 3 392/Coch/2024 2017-2018 ITBA/APL/S/250/.2023-24/ 27.03.2024 1063495053(1) 4 574/Coch/2024 2014-2015 ITBA/APL/S/250/.2023-24/ 26.03.2024 1063413799(1)
Heard both the parties. Case files perused.
We note at the outset with the able assistance coming from both the parties that the CIT(A)’s impugned identical lower appellate discussion has upheld the Assessing Officer’s action disallowing the assessee’s sec.80P deduction claim(s), involving varying sums, in all these assessment years for the sole reason that it had derived the corresponding interest income from regular members having voting rights as well as nominal/associate members and therefore, going by case law Citizen Cooperative Society Ltd., vs. ACIT [2017] 397 ITR 1 (SC) that it is only the interest income derived from extending credit facilities for the former category which qualifies for sec.80P relief.
Faced with this situation, learned DR could hardly dispute the clinching legal developments and their lordships’ latter decision in Mavilayi Service Cooperative Bank Ltd., vs. CIT [2021] 431 ITR 1 (SC) has rejected the Revenue’s very stand to conclude that the impugned sec.80P deduction could not be denied to a co-operative society qua interest income derived from nominal/associate members as well as once it is 388, 392 & 574/Coch./2024 along with SA.Nos.137 to 140 /Coch/2024 & Ors. The Kumbadaje SCB Limited. in compliance to the State Co-operative law provisions. The assessee succeeds in its’ sole substantive ground in all these cases. Necessary computation shall follow as per law. Ordered accordingly.
These assessee’s four appeals ITA.Nos.385, 388, 392 & 574/Coch./2024 are allowed in above terms and it’s stay applications S.A.Nos.137, 139, 138 and 140/Coch./2024 are dismissed as rendered infructuous. A copy of this common order be placed in the respective case files.
Order pronounced in the open court on this 07th Day of November, 2024.
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